Economic Development 03 21 2012 Economic Development or producing culture through contestations concerning the allocation of capital Contestations produce culture and reinforce power Uneven Development New York Capital of capital in the US and the world Affect on how people relate to one another Economic Development The process by which an agricultural society moves toward industrialization and usually higher patterns of income After WWII scholars pondered the disparity of wealth Looks at other countries and came up with measurements of wealth for other countries Human Development index When countries had low standard of living low literacy rates they were usually countries that were involved in subsistence agriculture Subsistence agriculture producing only what you use eat need Relationship between how people allocate resources and their success rates low literacy rates high infant mortality rates etc Once the countries introduced and formed higher technology for agriculture their rates became better Often times scholars say this is the only way to think about it but there are alternative theories of development Modernization Theory The fate of our times is characterized by rationalization intellectualization and above all by the disenchantment of the world Max Weber early to mid 1800 s Hard work frugality delayed gratification Profit goal rather than sin Work is an ethical obligation Abstaining from work you are a phiraya Facts numbers rise in markets central to society Rationality Some relationship between development and rationality Talcott Parsons 1950 s Celebrated US capitalism Biggest practitioners of capitalism modern If you are a state and you want to be modern you follow states in the west if they want economic development Promoted Protestant work ethic Fluent democratic adopt western values markets government institutions Fischer Clark Theory Stages of economic growth by Walt Rastow 3 theories of development The Stages of Economic Growth Part 1 Traditional Society Part 2 Pre Conditions for Take Off Part 3 Take Off Part 4 The Drive to Maturity Part 5 High Mass Consumption Countries should adopt Western standards diffuses from cities into rural countrysides Is this method the only way to go about modernizing undeveloped countries Theories of Development Continued 03 21 2012 Dependency Theory Critic of Modernization Theory Developed underdeveloped Underdeveloped is actively produced Relationships that encourage Andre Frank Observation that legacy of colonialism o Left the colonies at a disadvantage o Interdependent on trade Assumes the west is doing the exploiting domination of underdeveloped nations o Created by the developed country o Direct opposite of modernization theory Allow the west to dictate development What s your recourse for development West exploits what do you do Kick out western firms and do it yourself Don t allow them in your country People still wanted modern help o Venezuela kicked out shell Do it themselves International Affairs Policy Do not desire transnational companies because they exploit their workers and resources Import substitution produce luxury goods on their own o Countries will target institutions Debt default borrow from INF but have no intention of paying it back Problems Critics Ignores internal causes of poverty Ignores the internal and external effects of outside countries as powerless to exploitation from developed countries o Underdeveloped cannot challenge developed countries on their own terms World Systems Theory The only meaningful way to view development is to examine it o Critiques modernization theory Theoretical room for movement from under developed to less globally developed Analyzed global history 1500 AD Radical in global affairs Before there were a succession of empires that ruled large areas of Europe as a single political unit o the surplus was given off i e tributes The Long 16th Century 1450 1600 end of feudal empires yielded a single division of labor with multiple political units development of states market transactions became important Military and resources by 19th century that began to slow down initially embroiled with heavy competition o production and trade o exploiting comparative advantage o Hapsburgs tried to reassert feudal empire over rest of Europe So did Nazi Germany and Napoleon o Single division of labor and multiple political entities One state that dominates the world state hegemonic power o Most powerful economic and political power in the world Trade dominance Financial dominance Greatest industrial producer o 16th century Spain did this dominated the Mercantilist System of the times o Dutch took over the Market of the Spanish Dutch finance o 19th Century British Empire took over system ruled under Ideology of Free Trade o 10th century United States came to power in the world system Neo Colonialism through transnational corporations Kondretiev Waves The historic trends of ascending and decline of hegemony Steps o Propensity o Recession o Depression o Improvement 40 year cycles o periods of ascension and decline of hegemony o periods of conflict are periods of movement time to gain or lose power o Market Exchange ties all types of economy i e fruit HIGH PROFIT CONSUMPTION GOODS PERIPHERY CHEAP LABOR Neocolonial AND DOW CORE CORE SEMI PERIPHERY PERIPHERY CORE hegemonic high value labor o Most economically diversified o M and Wealth o Strong central government with strong military o Sufficient tax base o Highly industrialized o Specialize in information and service provisions finance Total yield is strong influence over the other two groups PERIPHERY o less economic diversification o weak governments o focus on primary raw goods mining agriculture o least industrialized provide cheap labor textile industry is very mobile o targets for investment from transnational corporations o disparity in wealth very wealthy very poor NO MIDDLE CLASS SEMI PERIPHERY o Embody aspects of both of the other categories Movement occurs in this model o Zero sum game one country moves up while another moves down Where is the culture 03 21 2012 There is an alternative way to think of development beyond the nation state Culture is not a thing We usually miss subtle mechanisms Zapatistas another way to look at cultural development Reconfiguration of land laws Land Law o Hejito o Cesseded Mexican government o Mini socialist groups o Refutes modernization dependency and world systems theories o US core of the world system